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ACORN GROWTH COMPANIES ACQUIRES CIS

Acorn Growth Companies (“Acorn”), a private equity firm investing exclusively in Aerospace & Defense (“A&D”), announced Monday it has acquired CIS Secure Computing, Inc. (CIS), headquartered in Dulles, VA. The acquisition marks Acorn’s second in the defense electronics segment, and the third overall investment in its fourth investment fund.

“Headlines continue to serve as daily reminders that networks are not safe and that cyberspace is anything but secure,” said Rick Nagel, Managing Partner for Acorn. “CIS has a proven track record and excellent past performance proving that sometimes the best solutions to software weaknesses are hardware solutions. CIS is the undisputed market leader in providing these solutions to the United States Departments of Defense and Energy, and is poised to support America’s need for greater network security.”

Founded in 1992, CIS continues to serve the secure communications market as a leading provider of communications and computing solutions for government and commercial customers. CIS designs and manufactures a wide range of products, which include secure telephones (under the TSG protocol), secure computers (TEMPEST), encrypted tactical communication systems, secure tele- and video-conferencing systems, and a variety of specialty systems used in secure networks. The products are a mix of those designed and manufactured in-house and Commercial-off-the-Shelf ("COTS") IT and telephony systems that are modified. Primary customers include organizations within the defense, intelligence, law enforcement, and homeland security communities whose missions depend heavily on their ability to communicate and exchange information in a secure manner and to operate in challenging physical environments. Many of the products are also available to nations allied with the United States.

“As the need for these systems grows and the requirements become even more stringent, it will be our opportunity to continue to lead the market and stay ahead of the hackers,” remarked Robert Hinaman, a Partner with Acorn. “Acorn is planning to take these technologies to our allies and to corporations that put a premium on security.”

“We have found the right partner in Acorn,” stated Bill Strang, CEO of CIS. “Acorn will to continue to invest in the products and our business development efforts so that CIS can enter into new markets and expand those in which it already has a lead.”

Terms of the acquisition were not disclosed.

Advisory services were provided by Bluestone Capital Partners, a boutique investment banking firm headquartered in Tyson’s Corner, VA that provides advisory services to middle-market companies on mergers and acquisitions, divestitures, and other corporate finance transactions in the aerospace, defense, and government market segments.

Debt financing was provided by Capitala Group and Texas Capital Bank.

CIS Secure Computing, Inc. CIS serves the secure communications market as a leading provider of communications and computing solutions for government and commercial customers. CIS designs and manufactures a wide range of products, which include secure telephones (under the TSG protocol), secure computers (TEMPEST), encrypted tactical communication systems, secure tele- and video-conferencing systems, and a variety of specialty systems used in secure networks. The products are a mix of those designed and manufactured in-house and Commercial-off-the-Shelf ("COTS") IT and telephony systems that are modified. Primary customers include organizations within the defense, intelligence, law enforcement, and homeland security communities whose missions depend heavily on their ability to communicate and exchange information in a secure manner and to operate in challenging physical environments. http://www.cissecure.com/

Acorn Growth Companies is a middle market private equity firm focused exclusively on A&D. Acorn invests solely in operating companies that strive to enhance global mobility and national security. Acorn has a strong reputation in the industry and is recognized for its deep understanding of the A&D markets, with proprietary access to the best companies within these sectors. With operational expertise and its ability to lead and manage investments through variable economic and industry cycles, Acorn works in tandem with management to build its portfolio companies into significant market leaders. http://www.acorngrowthcompanies.com/